2008 (7) TMI 1124 - AT - FEMA

Summary

Issues:
- Violation of provisions of section 8(1) and 8(2) of the Foreign Exchange Regulation Act, 1973.
- Adequacy of evidence and corroboration in establishing guilt.
- Admissibility of co-noticee's statement as evidence.
- Validity of confessional statement obtained from the appellant.
- Compliance with principles of natural justice regarding cross-examination.
- Quantum of penalty imposed.

Analysis:

The judgment by the Appellate Tribunal for Foreign Exchange, New Delhi involved an appeal against an Adjudication Order imposing a penalty for contravention of provisions of the Foreign Exchange Regulation Act, 1973. The appellant, Hardeep Singh, was charged with violating section 8(1) and 8(2) of the Act by acquiring foreign exchange without permission. The appeal raised concerns about lack of opportunity to defend, insufficiency of evidence, and contradictions in statements. The appellant's association with Malkiat Singh Multani, who admitted illegal foreign exchange dealings, was a key point of contention.

The Tribunal examined the evidence, including statements from Enforcement Officers and co-noticee Malkiat Singh. It found that the appellant's admission of selling foreign exchange to Malkiat Singh was corroborated by Malkiat Singh's statement. The Tribunal rejected the appellant's argument of coercion in obtaining his statement, citing the burden of proof on the appellant. It referenced legal precedents to support the admissibility of retracted confessional statements under certain conditions.

Regarding the right to cross-examine the co-noticee, the Tribunal emphasized that natural justice principles were not violated as sufficient justification was lacking. It cited a Supreme Court ruling to support this stance. Ultimately, the Tribunal concluded that the charges against the appellant under section 8(1) and 8(2) were proven, leading to a guilty verdict. However, considering the appellant's circumstances, the Tribunal reduced the penalty amount from Rs. 92,500 to Rs. 60,000 to achieve justice, with instructions for penalty payment within a specified timeframe.

In summary, the judgment addressed issues of evidence sufficiency, admissibility of statements, compliance with natural justice principles, and penalty imposition, ultimately upholding the guilt of the appellant while modifying the penalty amount in consideration of the appellant's situation.